Nobody should be surprised by anything in the Long Term Energy Plan the Ontario government released last week. The biggest question is what will replace coal-fired generation, which the government has promised to phase out. Coal has historically provided 20–25 percent of the province’s power. The LTEP leads off by saying conservation will do part of that, which it absolutely will not. (Try charging your cell phone with conservation, and you’ll see what I mean.) This is just lip service to please “environmentalists” who think electricity is the worst kind of energy. The government’s real plan is to replace coal with natural gas. And that would be a terrible move.
It would be terrible because even though gas is cheap today, companies that generate power with gas still cannot make a profit without massive support from rate payers. As I showed in my most recent post, nuclear power—gas’s biggest competitor in the baseload market—subsidizes gas and wind generators in Ontario. Not counting coal, nuclear and hydro are the cheapest sources of electricity in Ontario. Nuclear and hydro generate by far the most kilowatt-hours. To these kWhs, the province attaches what we could call the “political correctness premium”—officially called the Global Adjustment. Every Ontario rate-payer pays a Global Adjustment charge. This directly subsidizes the warm and fuzzy kinds of electricity that are just too expensive to survive otherwise.
These politically correct sources include wind, solar, and conservation. Yes, and conservation. The government actually counts conservation as a source of electricity supply, even though this flies in the face of every human’s physical experience. As I mentioned, try using conservation to run your household appliances; let me know how it works out. If you are an emergency room doctor, try resuscitating a patient with a conservation-powered crash cart. Or, next time there’s a blackout, switch to your emergency conservation backup supply. Parker Gallant, who writes for the Financial Post, has a great column on the idiocy of conservation.
Let me be fair: the current plan won’t lead to blackouts. Not even the government really believes conservation will contribute actual electricity. That’s why the real plan is to replace coal with gas. Gas will of course provide real electricity, but—as today’s Global Adjustment figures prove—at dangerously high prices. Anybody on a fixed income who lives in a high rise is going to feel this. Any electricity-intensive industrial operation will be forced to cut backroom one-off discount deals with the government, or move to another jurisdiction where power is cheaper.
Everybody should remember that the plan was devised in order to please rich environmentalists who prefer natural gas—the same fossil fuel that is producing the skyrocketing greenhouse gas emissions in Alberta’s oil sands—over nuclear energy, which releases no carbon into the atmosphere.
To me, that is the kicker. The entire coal phase-out is completely unnecessary. Let’s remember that coal combustion emissions are the original reason for the phase-out: first it was nitrogen, sulfur, and mercury; then it was carbon dioxide. Ontario could have low-emission power, at bargain basement prices, if it put the nuclear contribution up to sixty percent instead of the planned fifty. That was the situation in the mid-1990s—Ontario’s generation-related pollution emissions were 9 million metric tons below the eventual Kyoto target. There were five coal stations (today there are four). Power was cheap.
Coal could and should stay in the system as cheap large scale backup. The stations are already built and paid for, and connected to the grid. They have years of operational life in them. You don’t like the emissions? Then let’s burn less of it more efficiently, and scrub/catalyze the SOx, mercury, and NOx. Exactly as we do with cars, which are a bigger source of pollution. Hydro and existing simple cycle gas could provide peaking capacity.
Oh well. The good news is, the Long Term Energy Plan wasn’t written in stone. It is a PDF document and it costs nothing to edit the original.